Who owes whom money?

 Debt and obligation.  Who owes what to whom?  Consider.  Without any particular elaboration, let us consider the nature of a student loan contract, and yes, it is a contract.  It is a contract with some very generous terms, for important reasons.  I, the taxpayer, loan you money for the purpose of a college education (and hence, for my own salary, which is a little odd in my case, but let's let that pass for the moment).  The interest that I charge you on that loan is very low.  Why am I willing to give you such a low interest rate?  There are several reasons.  The primary reason is that an educated populace creates a "positive externality" in econo-jargon.  That is, when people pay for college, they not only benefit themselves, they create an educated workforce which benefits the country as a whole.  I benefit from that, even not being part of the purchasing of said education... even though I sometimes am a part of that transaction.  I get my salary from it if you attend my particular institution of degree conferral, in which case, I would be loaning you money to pay my own salary.

But anyway, an externality occurs when someone not involved in an economic transaction is affected by the transaction, and whether the externality is positive or negative depends on whether people outside the transaction are helped or hurt.  Education creates positive externalities.  Markets with positive externalities under-produce the good in question, so we subsidize those goods.  In part, we distribute grants.

But if you can't pay for the whole shebang with grants, you will need loans, and we shall be generous because of those positive externalities.  I, the taxpayer, make a contract with you.  I shall loan you the money to go to an accredited institution of accredited accreditation to receive a certificate declaring you to be edumacated.  Rather than some private bank, which will charge you-- I don't know, are you watching interest rates right now?  Anyway, I shall be generous.  Depending on the structure of the loans, if you stick with subsidized, you'll get a rate under 5%.  What's more, interest will not begin to accrue until you leave school.  Given the salary difference between those with and without college degrees, this is what we call a "fucking awesome deal."  That, too, is technical terminology in economics.

There are some catches, such as the fact that your student loans cannot be discharged in bankruptcy.  This is why you get such a low rate with no money down and no interest accrual for years.

Also, it is a loan.  A loan is different from a grant or a gift.  Perhaps you took the SATs or ACTs to gain admission to an institution of degree conferral.  Standardized tests may have challenged your knowledge of English vocabulary, although various wokestirs have decided that this is a bad thing.  I dissent.  I actually think it is important to understand the difference between a loan and a grant.

The former is a contract.  When you sign that contract, you are signing a legal agreement to pay me back.  I agree to loan you the money, with very generous terms-- an agreement I have made via statutory law-- and you sign your name on the line, agreeing to pay me back.

Once you do so, do you really-and-truly owe me that money?

It's a simple question.  Do you owe me that money?  Or, can some guy with some big-ass guns come along, and point them at me and say, no, deal's off, my money is gone because guy with the guns says so?  (HINT:  Nancy Pelosi says "no.")

While you contemplate whether or not a loan is a loan until interloper-with-guns says otherwise, let us consider another question of debt and obligation.

Consider a hypothetical jewish college professor (OK, there are a lot) whose grandparents emigrated to the US to escape Germany, long after the Civil War, lived in the North and hence did not have any connection to Jim Crow, did not participate in zoning or property control issues in order to have a role in redlining and keep going.  Our hypothetical professor's immigrant grandparents would not have even been considered white upon emigrating, nor would the parents.

But our professor is now a taxpayer, after having taken out and repaid loans, coming from a family of teachers and such, meaning no money.  Our hypothetical jewish professor has loaned a lot of money to the next generations to get college degrees.  Some of the debtors are descended from slaves.

Our hypothetical professor played no role in that, nor did his ancestors.  No application of slaveryjimcrowredlining will work here.  But does he actually owe the student/graduate money because the definition of whiteness has changed, and student loans are supposed to be canceled?

What would it mean for concepts of debt and obligation to say both that the agreement to repay the loan is declared null and void, or even partially canceled, but to impose a claim of debt going the other direction based not even on family history, but a revisionist social construction of race that creates a debt upon a reconstructed race?  Debt and obligation cease to be determined by actual contract, and become a matter of assessing something much more amorphous if it is determined not by individual culpability, nor family culpability, but by the ever-murky and ever-shifting boundaries of this strange thing we call "race."  But nothing so prosaic as an actual, written contract.

When Biden issued an order on student debt incurred by those defrauded by Corinthian, I wrote a post commending the more limited decision.  Corinthian was a scam, and there's a point at which the people defrauded by the scam had just suffered enough.  When you move from the specific case of fraud victims to everyone, though, you challenge the concept of a contract, and it becomes more problematic.

As for reparations, without getting too far into the topic, the hypothetical case above demonstrates a basic problem with the concept.  The slaveryjimcrowredlining construction was created, and will continue to be extended eternally, seeking culpability or debt from anyone, demonstrating that the arguments are constructed to justify the demand rather than deriving a conclusion logically from a sound and generally agreeable premise.  However, the point is really the difficulty of combining the argument for reparations with the argument for student loan debt cancelation.  In the strange world of modern ideology, these two ideas "go together," not because they fit together in any logical structure, but because groups have put them together.  That's what happens.  That's how you get ideology.  Yet, trying to build a coherent idea of debt and obligation becomes nearly impossible.  One is required to throw out contracts, and then construct ironclad concepts of debt and obligation based on socially constructed "identity" categories.

How is debt incurred?  How is debt discharged?

Without formalized processes for both, we're lost.

Is Biden's action beyond his legal and constitutional authority?  Probably, and when pressed on the matter some time ago, Speaker Pelosi asserted that Biden could not just cancel student debt with the stroke of a pen.  That would require congressional approval, because student loans exist by statute.  She was right then, and the position is still right today.  Will this survive court challenge?  Probably not.

Even beyond the constitutional and statutory issues, though, it is important to think about a variety of issues.  Do contracts matter?  If not, how do you establish debt, obligation, or the process by which it is discharged?

Ranky Tanky, "Pay Me My Money Down," from Good Time.